The Big difference between Nigeria’s Palm Oil and Malaysia’s Palm Oil

Is there a big difference between Nigeria’s Palm Oil and Malaysia’s Palm Oil?

They say we all see things in different lights.

There is a saying here in Nigeria

What might appear white to you, will be brown to a politician, grey to a lawyer and Red to a policeman, lol.

This same view is held in the Oil Palm Industry, particularly in the area of Palm Oil Production.

 

The Big difference between Nigeria’s Palm Oil and Malaysia’s Palm Oil

Now let me ask you a question

Which of the two images in the picture below contain Palm oil?

Nigeria's Palm Oil and Malaysia's Palm Oil

 

If you said the image on the right, you are correct.

If you said the image on the left, you are also correct as well.

 

How you ask?

In Nigeria we have grown up seeing and using Palm Oil in its raw state(Crude Palm Oil), the red rich carotene containing oil we love, this we use for all kinds of native soups and sauces.

While if you grew up in Malaysia or Indonesia, you will be more use to the clear coloured Palm oil (RGB Palm Oil)

Why is this so?

 

The History of Cooking Oil in Nigeria

You see here in Nigeria, Crude Palm Oil is produced for use in our native dishes, although over the years we have have adapted it for other dishes.

Oil_Palm_Banga_Soup_thumb.jpg

 

As a cooking oil, it has too many properties that don’t seat well with other dishes i.e stew and frying.

The redness of it will change the color of jellof rice and other dishes, while trying to fry an egg or do pastries with it just won’t bring out the natural flavor you want. Let not also forget that that red color will change the color of the pastry as well.

So we had to look for another cooking oil, enter Ground Nut oil, before the 1960’s we were known as one of the largest producers of Ground Nuts. We had ground nut pyramids in the north that stretched as far as the eyes can see, with this cash crop came ground oil production which serviced the whole of the country and introduced a new cooking oil source in Nigeria.

groundnut-pyramid_thumb.jpg

 

Then the boom of ground nut waned in the late 1960’s, taking with it the ground nut oil industry. As companies shifted operations from agriculture to the new Oil of Petroleum, we began to import ground nut oil to handle out cooking oil needs.

Now you have to understand that back then we had Palm Oil and didn’t have use for Palm Kernel oil, because we didn’t have the technology or the investments needed to develop Palm Kernel oil.

It wasn’t till the later 1970’s that the cost of importing and producing ground oil drove some some industrious Nigerians to seek other types of cooking oil, different thing plants were tried. rapeseeds, sunflower seeds and Palm Kernel.

People gradually learn that Palm Kernel nuts gave more output of oil per ton than other oil seeds, and thus a new industry in palm kernel oil production was born. Since we had a lot of Palm Kernel nuts just wasting away in various plantations across Nigeria, it became our cheapest source of cooking oil till date.

 

Now you can understand why the demand for Palm Kernel Oil locally is high and the demand for Palm Oil Locally is low. The reverse is the case in the international market, high demand for Refined Palm Oil and Low demand for Palm Kernel oil.

Pz-Wilmar.png

Why is the demand for Refined Palm Oil in the global market higher than Palm Kernel Oil?

To answer that you have to understand what Refined palm Oil is and what it is used for

When Palm oil is refined, it goes through various processes,

The first of which is where its Complex Organo Phosphorus Compounds are removed by hydration with water, Orthophosphoric Acid and Polybasic Acids. The process is called Degumming (removing the gums or the phosphatides). If this is not done.

Degumming.jpg

 

The next stage is bleaching of the degummed Palm oil to change its colour and purify the Fat and Oil, this is done by using either Acid Activated Bleaching Earth(Clay), Natural Bleaching Earth or Activated Carbon and Synthetic Silicates.

The last stage, Deodorization is done by using a vacuum steam distillation process. Here the oil s passed through a high pressure steam vacuum to change the smell and separate other volatile compounds.

Deodorizing.jpg

 

Once all this is done, you get RBDPO Refined Bleached Deodorised Palm Oil.

Now comes its uses.

Refined Palm Oil  can be used on its own or fractioned into other oils or mixed with Palm Kernel oil for other uses.

When Refined Palm Oil is Fractioned you get these two new products.

1. RBD Palm Olein

Nigeria's Palm Oil and Malaysia's Palm Oil

2. RBD Palm Stearin

Nigeria's Palm Oil and Malaysia's Palm Oil

 

In its pure form, RBD palm olein is sold as cooking oil. RBD palm olein is also used in the manufacture of margarine and shortenings and in industrial frying of processed foods like potato chips, chips, instant noodles and other snack foods.

 

RBD palm stearin is used in for margarine and shortenings and as a source for producing specialty fats for coating in confectionery. It’s also used in the soap and oleochemical industries.

Nigeria's Palm Oil and Malaysia's Palm Oil

Malaysia and Indonisea focused more on exploiting both Palm Oil and Palm Kernel oil, by refining it to the worlds export standards. While we focused on producing Palm Oil and Palm Kernel Oil for local use.

This is the reason why our export of Palm oil and Palm kernel oil is so low, we consumer the bulk of it locally and we do not refine Palm Oil or Palm Kernel Oil for export.

These differences in the way we view Palm Oil is the reason why Malaysia and Indoneisa are seen as the top oil palm producers in the world and Nigeria is now currently ranked at the Fifth.

Nigeria's Palm Oil and Malaysia's Palm Oil 

This alone is the big difference between Nigeria’s Palm Oil and Malaysia’s Palm Oil, its the reason we are losing so much revenue in the Oil Palm Sector in Nigeria. Our inability to refine our palm oil is the reason why our export of palm oil has remained the same since 2010

Nigeria's Palm Oil and Malaysia's Palm Oil

You have to understand that at this age and time, the world needs RBG Palm Oil and not the CPO(Crude Palm Oil) which we currently produce in wasteful abundance. In the past we have tried to sell and export our CPO to the west, but since they already buy Refined Palm Oil why would they buy Crude Palm Oil and refine it themselves. When they can get the refined Palm Oil from Malaysia and Indoniesa.

We need to up our game and start Refining our Palm Oil for our local use and for exports.

call-brian-today

Conclusion

As a Producer of Palm Oil, Nigeria has reached that stage where it needs to diversify as indoniesia and Malaysia did.

They started the process in small holdings and little by little, they grew into a mega producer and exporter.

Who said we can’t do the same thing.

So, over the next couple of weeks, I will show you how you can refine Palm Oil into vegetable oil, using a list of details, formulas and videos to help you alone the way.

We will look at the processes, the machines involved and how you can do it locally (if possible)

If you have any questions, please feel free to drop us a comment below.

 

44 Comments

  1. Emmanuel on May 8, 2016 at 9:09 pm

    What is the cost (rough estimate) of setting up a medium or small scale refinary, employing best industry practices and equipment?

    • Brian Palm Permutations on May 9, 2016 at 12:43 pm

      Hi Emmanuel

      A rough estimate for setting up A palm Oil refinery ranges between, N9-35 million. All of which depends on your processing capacity and weather you also want to include bio diesel too. If you would want a breakdown of of costs or a full white paper about getting started in it. contact me via our mail.
      Brian

  2. Chuks on May 15, 2016 at 8:23 am

    Hi Brian,

    Will I be able to set up palm kernel oil extracting mini factory on a plot of land (100 by 50)? Also, which is more profitable in eastern state on Nigeria – kernel oil or palm oil? Apart from the land i am planning to invest 1.5 million ngn to kick start the business.
    Thank you

    • Brian Palm Permutations on May 16, 2016 at 1:01 pm

      Hi Chuks

      I sent you an email over the weekend about how to get started.

      Do check it in your mail

      Brian

      • Jane Makwinja on April 15, 2018 at 9:45 pm

        please send for me the information on how to get started also in the eastern part

  3. Domingo Adenuga on July 20, 2016 at 12:14 am

    where can I buy palm kernel oil processing machines.? and where can I buy motorized palm harvest machines

  4. isaac funminiyi on August 31, 2016 at 9:41 am

    Sir,i will like to to meet you as a person sir.u can mail ur office address or ur number to funminiyioyedeji@yahoo.com.I need tutor on palm oil and palm Kernel refinery.thanks sir

  5. Okoh Patrick on October 15, 2016 at 7:49 am

    Where can one get the equipment or instruments for testing the quality of palm oil in Nigeria. Please send response to my Email: ptrckokoh@yahoo.com

  6. Alasan Mogiemhe on October 19, 2016 at 6:01 pm

    Sir,
    I have a local mill in Uwan-NIFOR, Benin city, Edo State.
    I sell PKN but need the machine that crushes the nuts to extract PKO.
    Kindly help with a link or the estimate for the machine.
    Thank you.
    Alasan.

    • Brian Ahamefula on October 23, 2016 at 4:32 pm

      Hi Alasan, there are some people I know who import these machines. Or would you like the locally fabricated ones

  7. Gabriel njoku on November 29, 2016 at 11:48 pm

    Need palm olein and stearin samples please, how much would it cost you to get it down to me in Abuja and how fast.

  8. Mimah on December 9, 2016 at 10:19 pm

    Please I need your contact either your phone number or your address, I would love to meet you in person. Thank u very much.
    Email: mimahibe@gmail.com

  9. obincoweld on January 11, 2017 at 2:00 pm

    hello guys, i am a fabricator and a good one at my job. We fabricate all agro allied machines but mainly palm oil processing equipment and palm kernel oil expellers.

    • Oga on February 12, 2017 at 7:52 pm

      Can you please send me your contact info via email at sgunge@gmail.com

    • Ruth on May 30, 2017 at 7:19 am

      Kindly contact me I would like locally fabricated machine’s.

    • Willam on June 5, 2017 at 12:58 pm

      Can you pls send me your contact details to my email osas_white@yahoo.com. Thanks

      • Brian Ahamefula on June 15, 2017 at 3:55 pm

        Hi Osas

        Please use the contact page message feature to send me a mail.

        I will get right back to you.

        Brian

    • Emmanuel Ani on February 12, 2018 at 7:10 pm

      Hello, i am interested in processing of palm oil. Can you give me cost estimate for a large scale production starting from an existing palm fruits in a plantation. I will be glad to get both the cost of setting up and the operating cost. i thankfully wait for your kind assistance.

  10. samuel on January 17, 2017 at 1:08 pm

    Thanks for this wonderful information, it was really helpful.
    I want to start the production of palm kernel oil but I want to know companies that have demand for the product as it will help in my sales forecast.

    Secondly I have red palm oil or crude palm oil in a very large volume or cormercial quantity. I can supply any amount if needed. I want companies or merchants who buy this products in Nigeria. I can ship the product to any part if the country.

    Kindly send me the contacts that can help me grow my customer base. Email; ukabams@gmail.com. phone; 08062465699

  11. DannyO on February 15, 2017 at 2:08 pm

    Very inspiring. Been searching for info like this especially how to get cost effective machinery for CPO.
    You stated that yoú know some people that import the machines, can you pls link me? I believe the new technology means the old process we use for locally fabricated machines may not be the best.
    Also any other info about setting up a more effective and efficient CPO mill will be appreciated, as I have access to a whole LGA of palm fruits.

    Thanks,
    DannyO

  12. Shantanu Sohoni on March 23, 2017 at 8:08 am

    Hello Sir,

    First of all , this is a very helpful blog for students and thank you for the same. I am a student of chemical engineering doing research on Palm oil Industry and I wanted to know how to conduct Break even analysis and Profitability analysis of Palm oil refinery in India.Specifically, what it would it cost (rough estimate) to setup up a medium scale refinery in India with high end technology.

    • Brian Ahamefula on March 26, 2017 at 8:47 am

      Hi Sohoni

      Thanks for your comment, the first thing you will have todo is find out the type of machinery required for the Palm Oil refinery, what capacity and tonnage the machines will handle, number of staff required to run the machines, how much will the machines cost and how long can you run them before mantaince is required.

      Then the next thing you will have to look at, how any palm trees will give you the require quantity for refining, how many hectares are required to grow them, how much labour is required, etc.

      Answers these question and you will know what the profitability and break even cost will look like.

  13. ekechi on May 20, 2017 at 5:14 am

    Hi ahanefula I read ur article it was very educating. I want to start up a medium scale palm oil refinery I need to know the machines involved and where to get them then the cost analysis.
    My email is uzoeshi20112@gmail.com

  14. pascal on May 29, 2017 at 2:22 pm

    PLEASE I AM INTERESTED .. CAN YOU SEND ME AN EMAIL FOR PROPER COMMUNICATION

  15. Azu Okparaugo on May 29, 2017 at 3:08 pm

    Very informative blog. Amazing how much knowledge i am able to acquire from visiting your site and reading your blog. Before now, all i knew about Palm oil, was – cook with it.
    I must commend your effort in putting such a rich information out there for people like me, with interest in Palm Products.
    I will definitely become a regular to your site, in search of new information

  16. Davies Olofa on June 9, 2017 at 3:51 pm

    Hi Brian, Great job you are doing, more grease to your elbow. I want to start palm oil processing in south west part of Nigeria, please where do you think is the best place for sourcing for raw material?
    What state in the southwest region is more fertile or preferable to start palm oil plantation?

    Please you can send this information to my email: daviesatolagbe@yahoo.com.

    Thanks.

    • Brian Ahamefula on June 15, 2017 at 3:54 pm

      Southwest hmm,

      you will be looking at around akure, ekiti and ogun areas.

      Brian

      • Kokobassey on November 27, 2017 at 10:27 pm

        Pls give your contact email address. I want some clarifications from on palm oil refining. Different in ours & Malaysia’s own.

  17. Bowen solace on September 1, 2017 at 8:29 pm

    Hi! Thank you Mr Ahamefula, i am planning on going into crude palm oil productions, i would love to know how much can go in, in building the mill, and i want to know separately, if i have the mill already, how much will be needed to produce 2500 litres of crude palm oil, and how long will it take to mill with a small mill 2500 litres, and how much can 2500 litres be sold in Nigeria market. i would appreciate if you can give me these information, thank you so much Sir, stay blessed.

    • Chijioke Ahamefula on September 12, 2017 at 5:57 pm

      Hi Solace

      Please send me a mail with this request.

      Brian

  18. Buchi on September 2, 2017 at 9:45 pm

    Thanks a lot for this wonderful platform! Sent you a mail, hoping to get a reply soon. God bless

  19. Abas on September 3, 2017 at 7:04 pm

    Thanks for ur kind info
    I’ve been researching on this for the past months
    I know this business is very juicy but I want to first go into plantation
    I want to start with 1000 stands yearly and maybe increase there after.
    I wish to start in Akwa ibom but I want to know how to get land from government .u know buying land will be so expensive so I wish I could get govt subsidized farmland.thanks

  20. Oscar on September 12, 2017 at 7:46 pm

    Hi Brian, Great n wonderful job you are doing here, please i want to know how many heads of palm oil kernel can produce e.g 25litre of red pail oil.i will be very grateful to receive ur favourable answer thanks.

  21. Oscar on September 12, 2017 at 7:52 pm

    Hi Brian, Great n wonderful job you are doing here, please i want to know how many heads of palm oil kernel can produce e.g 25litre of red palm oil.i will be very grateful to receive ur favourable answer thanks.

  22. Samuel Enebraiye on November 17, 2017 at 12:57 pm

    I will like to know where to buy cheap crude palm oil in bulk. Pls kindly give me a rough estimate for setting up a Refinery of 2tons/day capacity.

    • Chijioke Ahamefula on December 1, 2017 at 3:41 pm

      Best place to buy cheap palm oil are in Edo state Okitipupa Side and in Awka Ibom State. for a 2 ton capacity refinery your looking at over 50 Million Naira, if you are fractionating to Olien and Streatin you are looking at an extra 35 Million. Buying to produce will not be advisable, its better to own your own plantation and produce what you will refine.

  23. chimezie on March 28, 2018 at 7:23 am

    Hi Brian, are u thesame Brian whose family owns a plantaintion in igbuzor delta state,who engaged in an interview with a presenter from. Minaj system radio

  24. Sylavnus Chidubem on May 31, 2018 at 8:41 pm

    Hi Brian, I found your write up very interesting. I’ m currently trading crude palm oil and I would like to have the instrument for testing the quality of the oil please. I need information on how and where to get it thanks. Here is my email address, sylvanus.christian@yahoo.com.

  25. Anyiego on June 9, 2018 at 12:57 pm

    Thanks for this great information please am interested to start importing palm oil and refined vegetables oil from Indonesia or Malaysia please can you give me the full details about it, you can email me please

Feel free to ask me any questions

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